Annual Results 2015 - Meliá Hotels International Earned €101.6 Million before Tax, an Increase of 79 Per Cent

The Group Strengthens its Balance Sheet after Reducing Net Debt by €216 Million

After Discounting Two Major Extraordinary Items, Net Profit Increased by More Than 200 per cent

Gabriel Escarrer Jaume, Vice Chairman and CEO of Meliá Hotels International: “As we begin 2016, which marks MHI’s 60th Anniversary, we start the year in a stronger position than ever before, both in terms of the business and our financial position. The Company has also seen a significant improvement in our reputation and international recognition following the European Hospitality Awards naming the Company ‘Best European Hotel Chain in 2015’. MHI’s Strategic Plan to be presented during 2016 aims to further consolidate our brands, our digital commitment and strengthen the competitiveness and positioning of the Group."

Meliá Hotels International Financial Release 2016 (Photo: Business Wire)

LONDON--()--In 2015, Meliá Hotels International earned a Net Profit of €40.5 Million (€36 Million Net Attributed Profit), a significant improvement on 2014 with increases of 27 per cent and 18 per cent respectively, although 2015 and 2014 are not exactly comparable given that 2015 results are affected by a higher tax rate, the result of the current inspection, started in late 2014 on the accounts for 2009 to 2012 inclusive.

Discounting the impact of two extraordinary items, the impairment of the hotel in Puerto Rico (€29 Million) and provisions for the tax adjustment, Net Profit before tax for the year grew by €67 Million compared with 2014, an increase of more than 200 per cent.

For the full year, MHI generated revenues of €1,738.2 Million (+16 per cent) and EBITDA of €293.1 Million.

These results are due to the consolidation of the improvement in all divisions of the hotel business, generating a record increase of 15.1 per cent in revenue per available room (RevPAR) (15.81 per cent if we exclude Venezuela). This was a result of both an improvement in the business environment, strengthening of economies in key markets, as well as brand strategy and product repositioning. The Company highlights its digital transformation, recording significant progress both in consumer strategy through with sales increased by 27 per cent in 2015, as well as growth of 36 per cent through distribution partners on enhances sales and relationships with travel agents who remain one of the essential success factors for MHI, following 60 years of productive collaborations. In financial terms MHI met its debt reduction goals for the second consecutive year, reaching €768.8 Million, €216 Million less than in 2014 and returning to levels similar to those of 2007, resulting in one of the best years in the history of Meliá Hotels International.

2015 was also a record year for international expansion, with a pipeline of 62 new hotels at the end of the year, an additional 16,000 rooms. 2016 will see the Company continue with the addition of 20 to 25 new hotel signings, of which three have already been signed in the first quarter. 2016 will see the result of years of strong additions, with 25 hotel openings scheduled between January and December 2016 in 15 different countries. The Company continues to grow in Cuba, where is the first international hotel operator with more than 14,000 rooms in 28 hotels, following the announcements that it will manage Meliá Internacional Varadero – an amazing 924-room resort.

Regarding hotels under management, the majority of the hotels added to the portfolio in recent years, saw an increase of €19.5 Million in management fees compared to 2014, including hotels owned, leased and under management to third parties. Brazil’s hotels contribution was lower than the previous year due to the slowdown in the country’s economy, which was offset against an increase in higher fees from Cuba (+€5.5 Million) and the Mediterranean Division (+€4.4 Million). Urban hotels in Spain also contributed € 1.9 Million more due to the hotels in Madrid.

The Real Estate business provided Meliá Hotels International a total revenue of € 69.9 Million in 2015, €61.2 Million of which was linked to the sale and valuation of assets. Significant events behind this result included the sale of six resort hotels to the Joint Venture 80 per cent owned by an affiliate of Starwood Capital Group and 20 per cent by MHI, amounting to €178.2 Million, and the sales of the 875-room Calas de Mallorca resort for €23.6 Million and the 450-room Sol Falco in Menorca for €20 Million. MHI highlights the fact that all of these assets remain under Company management, confirmation of its strategy of alliances and asset repositioning to generate greater value and profitability, all within the ‘asset-light’ strategy of the hotel group. The Company’s progress further confirms the successful re-launch of the Sol Hotels brand with four innovative hotel concepts; Sol, Sol House, Sol Beach House and Sol Katmandu.

In 2016, the group estimates overall RevPAR growth of medium-high single digit figure for the first quarter and a medium single digit figure for the full year.

Improvements in all regions

In the Americas, revenue per available room (RevPAR) increased by 20.6 per cent thanks to a rise in average daily rate (ARR) of 21.3 per cent, affected by the adjustments in the exchange rate of the Venezuelan Bolivar. If the effect of Venezuela is discounted, RevPAR would have increased by 24.6 per cent (3.8 per cent in dollar terms). Excellent growth was achieved by resorts in Mexico with an increased RevPAR of 27.7 per cent and the Dominican Republic RevPAR rose by 24.5 per cent.

Regarding the outlook for 2016, the Company expects to outperform 2015 due to rate increases in resorts, the positive reception of the newly built Meliá Braco Village in Jamaica, and the imminent opening of two flagship hotels in North America: INNSIDE New York NoMad and ME Miami.

In EMEA (inclusive of Premium Hotels in Spain), RevPAR in owned and leased hotels grew by 11.2 per cent, due to the increase in prices, with a notable performance in France at Meliá Paris La Défense, despite the unfortunate impact of the attacks of 13 November. Germany achieved a strong performance throughout 2015, with Italy also having a solid year following the renovation of Meliá Milano and the successful opening of ME Milan Il Duca. The UK completed a challenging year, returning to growth in the fourth quarter with a RevPAR increase of 1.4 per cent thanks to the evolution of the Meliá White House and, above all, ME London, which achieved an average room rate in the region of £300.

Regarding the Spanish premium hotels, growth in major cities were due to hotels such as Gran Meliá Fenix in Madrid (+ 22 per cent) and Meliá Barcelona Sky (+14 per cent). This led to a consistent growth of 15 per cent in revenues in the fourth quarter. There was also an extraordinary performance from MHI’s flagship hotel Gran Meliá Palacio de Isora, Tenerife, with an increase of 23 per cent in fourth quarter RevPAR

Regarding the outlook for 2016, MHI expects an improvement in Germany and Vienna due to a strong year of trade fairs and congresses. This can also be attributed to the consolidation of ME London and the progressive positioning of the INNSIDE Manchester in the UK, plus positive expectations for hotels in Italy. In France, the spectacular evolution of Meliá Paris La Défense will offset the slowdown in Paris city centre hotels, still affected by the attacks in November 2015.

In the Mediterranean division, RevPAR grew by 8.7 per cent, with 7.5 per cent attributed due to price increases. The fourth-quarter growth in the division is focused on the Canary Islands, which in 2015 saw record results for the period, further intensified after the most recent differences between Russia and Turkey, and also following the addition of a new luxury hotel in Tenerife, Meliá Hacienda del Conde. The geopolitical situation in other destinations also had an impact on the hospitality industry in Cape Verde, where Meliá manages about 1,500 rooms.

With regards to the outlook for 2016, a positive performance is expected for the Spanish Coast and Islands, compared to alternative destinations where a situation of instability unfortunately remains, such as North Africa. Performance will also be positively influenced by the renovation and repositioning carried out by the Group in numerous resorts in the Balearic Islands. In the Canary Islands, in addition to the positive impact of the addition of the Sol Costa Atlantis and Meliá Hacienda del Conde on the island of Tenerife, there is also a forecast increase in flights to the islands of Fuerteventura, Lanzarote and La Palma, in all of which the Group has hotels.

The division Spain (City hotels) reports an increase in RevPAR of 13.1 per cent, mainly attributable to the consistent recovery in all market segments, which allowed MHI to maintain its leadership in ‘bleisure’ destinations with a focus both on business and leisure travellers, taking advantage of the Group’s experience and expertise in both the urban and leisure segments. Madrid maintained the upward trend of recent quarters, with improvements in the leisure, business and MICE (Meetings & Incentives) segments. Hotels in northern Spain also benefited from atypical weather conditions in the region and increased flight frequencies and better sales management. In the south there were strong performances from hotels in Marbella, Cadiz, Granada and Seville, which benefited from a record year in terms of events and congresses.

In eastern Spain there was a positive fourth quarter, especially in Catalonia, Valencia and Palma de Mallorca, particularly noticeable in the MICE segment, with a significant increase compared to 2014. Increases were recorded at Meliá Valencia +14.1 per cent, Meliá Sitges +11.5 per cent and Meliá Palas Atenea +9.6 per cent. Considering all the City hotels – including the Premium ones – Spain registered a growth of 17,5 TevPAR.

Regarding the outlook for 2016, sales in Spain saw improvements in the first quarter, both in first and second tier cities, penalised only by the ski resorts in the Sierra Nevada due to a shortage of snow. MHI’s portfolio in Spanish cities will be further enhanced by ongoing renovations at hotels such as the Meliá Lebreros (Seville), Tryp Apolo (Barcelona), and the former Tryp Ambassador will be rebranded as Gran Meliá Palacio de los Duques. Despite uncertainty about political stability in the country after the elections, MHI expects a continuation of the recovery of the Spanish domestic market.


About Meliá Hotels International

Founded in 1956 in Palma de Mallorca (Spain), Meliá Hotels International is one of the largest hotel companies worldwide as well as the absolute leader within the Spanish market, with more than 370 hotels (current portfolio and pipeline) throughout more than 40 countries and 4 continents under the brands: Gran Meliá, Meliá Hotels & Resorts, Paradisus Resorts, ME by Meliá, Innside by Meliá, Tryp by Wyndham and Sol Hoteles. The strategic focus on international growth has allowed Meliá Hotels International to be the first Spanish hotel company with presence in key markets such as China, the Arabian Gulf or the US, as well as maintaining its leadership in traditional markets such as Europe, Latin America or the Caribbean. Its high degree of globalization, a diversified business model, the consistent growth plan supported by strategic alliances with major investors and its commitment to responsible tourism are the major strengths of Meliá Hotels International, being the Spanish Hotel leader in Corporate Reputation (Merco Ranking) and one of the most attractive to work worldwide.


Luchford APM
Yasmine Najib
+44 (0)20 7631 1000


Luchford APM
Yasmine Najib
+44 (0)20 7631 1000